Should the MLB implement a salary cap, and what would that exactly look like if they did?

The salary cap in professional sports is a barline set by each league designed to promote competitive fairness and keep team financial spending in check. While many leagues like the NFL, NBA, and NHL all have these salary caps implemented into their leagues, Major League Baseball (MLB), one of the largest American sports leagues, still has not implemented one. This paper examines the structure and effectiveness of salary caps across various professional sports leagues, with a main focus on Major League Baseball (MLB). Salary caps, which are designed to maintain competitive balance by limiting team spending, are utilized in leagues such as the NFL, NBA, and NHL. However, MLB operates without a salary cap, leading to significant payroll disparities between large-market teams, like the Dodgers and Yankees, and smaller-market teams, such as the Oakland Athletics. This paper explores different types of salary rules: hard caps, soft caps, and no caps, and analyzes how these models impact competition in sports. Additionally, it compares MLB's lack of a salary cap to other leagues' structures, discussing key regulations like luxury taxes, foreign player limits, and salary arbitration. The potential for an MLB salary cap is proposed, including how it could be structured and the possible challenges it might present. While a salary cap could reduce competitive imbalances in MLB, the paper also considers the negative effects, such as limiting player earnings and team flexibility. Finally, the paper explores broader considerations, highlighting rules and regulations from other sports leagues that could influence the MLB’s approach to financial regulation.